The Importance of Localization in Micro Banking

Localization in Micro Banking is crucial. Micro banking is one of the many dimensions of 21st-century banking. It focuses on empowering the less or underprivileged sections and making a difference in human society. And the good part, it is growing at an impressive rate. Worldwide, microfinance institutions have lent billions of dollars to the needy for various purposes. The sector exhibits an impressive annual growth of 11-12 percent! These statistics denote the social and economic significance of micro banking amidst global objectives like uprooting poverty, improving livelihoods, encouraging small businesses, etc.

However, micro banking is different from conventional or regular banking. While both deal with money and financing, conventional banking deals with a much more sophisticated and informed customer base. Micro banking’s customer base is different and that’s why it requires a unique approach. It involves reaching out to prospects in their language and in a way they prefer. This is where localization comes into the picture.

As a micro finance player, if you’ve been looking to broaden your prospect base and make more valuable contributions, you need micro banking localization services. Here’s why.

7 Reasons Why Localization in Micro Banking is Important

Localization in micro banking is as crucial as it is for every sector. When leveraged appropriately and through professional micro banking localization services, localization can prove advantageous for micro banking institutions in the following ways.

1. Ease of Language Accessibility and Comprehension

The beneficiaries of micro finance institutions are usually unilingual people who may not be proficient in English or any other widely used language. Hence, the foremost role that localization plays in translating content, including educational literature, schemes, product details, etc., in the audience’s local language. It helps the audiences understand the offerings and engage more meaningfully and productively. It also helps develop trust and optimism about the micro finance institution walking the extra mile to make its offerings more accessible and comprehensible to the intended prospects.

2. Customized Products

People engage more effectively with products or offerings that appear native to them. Those with little access to the internet, limited education and restricted understanding of a particular language aren’t an exception to it. The more local an organization’s offerings, the more they resonate with the target population. Accordingly, localization enables micro banking institutions to develop products and services addressing specific financial needs. For instance, it may involve designing small-scale industrial loans to meet the financial needs of entrepreneurs from a particular region.

3. Economic Development

Localization services for micro banking can help encourage people to borrow loans from micro finance institutions. It can help them serve their financial needs like children’s higher education, fund their small businesses, or access savings-driven investment instruments like fixed deposits, recurring deposits, various government savings schemes, etc., Localized offerings explained in lucid local language will encourage people to step into banks, and seek more information on various loan and savings scheme. Collectively, it can help strengthen the local economy and contribute to the macroeconomic horizon.

4. Localized Financial Literacy Programs

That’s unfortunate but even today, despite the growth and deeper penetration of the internet, many people lack basic financial literacy. They still believe in or practice keeping money under their pillows to preserve it! Many factors, including linguistic inaccessibility and the absence of localized financial training programs, are responsible for it.

Localization plays a crucial role here by enabling micro banking institutions to develop financial education programs relevant to the specific needs and challenges of the local audience. While increasing financial literacy, these programs impart education in the population’s local language. Thus, while being financially literate, the target population gets insights into its local language. It helps increase the program’s comprehensibility and lets people step closer to financial independence and empowerment.

5. Social Impact

Micro financing isn’t only about lending money but making a significant social impact. Localization enables micro banking institutions to support social impact initiatives that make a difference to the local community. With increased trust and resonance, micro banking organizations can go beyond lending money and contribute to local infrastructural development, and the social and economic progress of a specific region.

6. More Engaging and Insightful Customer Support

Instant communication platforms have revolutionized communication and transformed customer service. However, customer service proves more effective when it is localized. Hiring micro finance localization services can help micro banking institutions provide personalized and responsive customer support through multilingual chatbots or other micro banking localization resources like translators, interpreters, etc. Local language interactions can help people understand the bank’s offerings better, address their queries in a more personalized manner, and make informed decisions. It can help enhance customer satisfaction and loyalty.

7. Increased Community Participation

Micro banking is also about empowerment. Localizing can take that to the next level with localized interactions and increased engagement. Micro banking translations and localization help micro finance institutions personalize customer support, encourage a greater degree of community participation in the financial ecosystem. It can include involving community members in decision-making, driving local business and organizational partnerships and promoting financial inclusion initiatives crafted to the specific social and economic needs of the local community.

In a nutshell, the importance of localization covers various aspects, including increased trust, localized interactions, personalized offerings, and local community participation and empowerment. The micro banking ecosystem, which is yet to accomplish many goals and cover many unprivileged sections of society, can benefit from localization in ways that we’ve seen above. Localization can also prove advantageous for the social segments micro financing institutions serve. It can contribute to their financial independence and prosperity, thus bringing them closer to the mainstream economy.

Elevate your micro banking services and engagement with Filose’s micro banking localization services. Our expertise in over 100 Indian and foreign languages, over a decade of localization experience and a profound understanding of the banking domain, make us a dependable localization partner. Please email us at sales@filose.com to explore more about our micro banking translation and localization services.

Ref. No – FLN03241048